Maybe Land Bank should be privatized!

Land Bank and Metrobank are supposedly wondering if they should put up an asset management company with some foreign banks to take care of the non performing accounts of the two local banks. At about P29 billion each, the two local banks can indeed benefit from some cleaning of their books. The problem is, Land Bank shouldn't have even been in all of those deals. Land Bank's reason for being a government bank is supposedly to help agrarian reform take root.

National Steel, for instance. What business does Land Bank have in extending P1.2-billion worth of credit to National Steel and P1.5 billion to a petrochem company? Those are activities so far removed from land reform. Or for that matter, why should Land Bank lend close to a billion pesos to Reynolds Philippines and All Asia Trust? Reynolds should have been funded by its foreign head office and All Asia is just a well connected bunch of so-called financial hot shots who went over their heads with among others, Land Bank's, (and therefore taxpayer's), money.

It is clear that Land Bank has gone way over the original intent for its creation. If it is inevitable that it should function as a commercial bank, then it should be sold to the private sector. Government has no business running a commercial bank in a country that has a surplus of commercial banks in operation.

There are those who justify Land Bank's continued government ownership in the light of PNB's privatization. It is argued (mostly by bureaucrats and politicians who raid it) that Land Bank is needed by government to hold and disburse government funds all over the country.

That is, of course, so much baloney. Any commercial bank can handle government funds, as some of them do in areas where Land Bank does not have a branch. What we need is a fair system of allocating the government business among the many local private commercial banks.

I see no practical reason for retaining government control of a commercial bank, which is what Land Bank is today. Safety is not enhanced by government ownership. In fact, government funds may be in greater danger under the control of government employees. Take a look at that Land Bank cashier who connived with a syndicate to siphon collections of the Bureau of Internal Revenue in a private account in a Land Bank branch in Quezon City.

The most important reason why government should not be in the commercial bank business is the propensity of government banks to grant behest loans to politicians and their friends. We do not always have an administration that is scrupulous about its actions as the Arroyo administration seems to be. Or a Land Bank president as honest and competent as Gary Teves. This is why privatization is the only viable long-term solution.

Maybe, a subsidiary can be created from the DBP that will be charged with the function of helping out in agrarian reform. But Land Bank is no longer what it should be. The government should cash in on what it has become and create a new agency to do what Land Bank should have done in the first place.

Jollibee abroad

Jollibee, according to its top honcho, is setting aside some P300 million for the company's expansion overseas. I guess the overwhelming market leadership in the local fast foods market has emboldened the Jollibee management to seek even greener pastures abroad. The prospect of earning foreign exchange in a regime of declining peso value is also tempting.

I guess P300 million is nothing much in dollar terms, but since that will mean exporting scarce local resources, Jollibee has the obligation to make sure such an investment will make a proper return that could be plowed back into the country. Maybe the initial foray of Jollibee in California, notably in Daly City, was encouraging to them. But I wonder if on the whole, the experience justifies expansion.

I visited the Jollibee branch in Cerritos at the intersection of Artesia Blvd. and Norwalk Blvd. in Southern California and I noticed that it isn't exactly teeming with customers, the way Jollibee branches here are. In fact, I counted three customers at merienda time. I asked my in-laws who were my hosts, why this is so.

The primary reason they gave me is, "kasi hindi pareho ng sa Pilipinas." For one, the hamburger is not langhap sarap. And they don't have the variety of food available in Manila. I was disappointed not to find pancit palabok. Worse, my in-laws say, the prices are not cheap compared to the competition. I guess they mean, if they will have hamburgers that are more attuned to American tastes, they might as well go to McDonald's.

A sister-in-law who was so addicted to Jollibee burgers here was disappointed with the Jollibee burgers near her house in Southern California. Concededly, I was told the opening of the outlet was greeted by crowds of Pinoys. But no more.

I e-mailed a brother-in-law about his impressions of Jollibee in Cerritos and this was his reply.

I can only speak for my initial experience here, when they just opened. The delivery time of the food was pathetically slow, giving insult to the term "fast food." For an outfit well experienced in opening numerous branches there, one would think that they already have these systems down pat. One thing they should realize is that, they are not the only game in town, and people have easy, quick and IMMEDIATE other choices at the same or better prices. That is what is America is all about: CHOICES ...and customer service.

Unless such a time that they have something which will encourage people to go back again, they will just be like any other Tom, Dick and Harry wannabes. Proof of this is the consistently demonstrated failures of many well-known Pinoy businesses trying to get a foothold here.

In fairness to Jollibee, it isn't the only disappointment among Filipino franchises. Max chicken is nowhere as good as the Max chicken here. Maybe it is the chicken they use. I don't remember the other restaurants mentioned to me that are equally disappointing. Only Goldilocks seems to be thriving, but even in this case, another sister-in-law always asks us to bring her a dozen ensaymadas from the Goldilocks here whenever we go and visit them in California.

I know the Pinoys in the States and elsewhere are ready to be loyal parokyanos of known Pinoy establishments. But they are not ready to patronize those that are not as good as the ones back home. This is something Jollibee must study before it embarks on its expansion overseas. They must work to preserve the brand image they worked so hard for back home.

Sneaky?

Dr. Ernie E. e-mailed this one for today.

The young man was determined to win his girl that evening. "I have loved you more than you will ever know," he said.

"So I was right," she responded, slapping him across the face. "You did take advantage of me when I was drunk last Saturday night!"

(Boo Chanco's e-mail address is [email protected])